November 14, 2023

Everything Fresh Limited (EFRESH) for the nine months ended September 30, 2023, reported a 26% increase in Revenue totaling $2.41 billion compared to $1.90 billion in the corresponding period last year. Revenue for the third quarter had a 15% increase to close at $733.06 million compared to $636.60 million for the comparable quarter of 2022.

Management noted, “ The overall increase was mainly due to the continued resurgence in the tourism sector in both Jamaica and the Bahamas, and less Covid related backlogs in production and shipping capacity causing delays in the movements of inventory, there were therefore less supply chain issues in 2023 compared to 2022.”

Cost of Sales amounted to $1.89 billion (2022: $1.52 billion), this represents an increase of 25% year over year.

Consequently, gross profit increased by 33% to $514.77 million compared to $386.48 million for the nine months ended September 30, 2022. The company booked gross profit of $158.65 million for the third quarter versus $128.85 million reported for the similar quarter of 2022.

Total Income increased by 32% to close at $514.82 million (2022: $389.41 million).

Administrative expenses increased by 23% from $297.89 million in 2022 to $364.93 million in the period under review, while selling and promotion expenses amounted to $19.91 million (2022: $14.84 million). As a result, total operating expenses for the nine months ended September 30, 2023, amounted to $384.84 million, a 23% increase relative to $312.72 million reported in 2022. EFRESH attributed the increased expenses to rising employee costs and the further utilization of their facility in bog walk.

Operating Profit for the nine months ended September 30, 2023, amounted to $129.98 million, a 69% increase relative to $76.69 million reported in 2022. Operating Profit for the third quarter amounted to $23.47 million (2022: $20.36 million).

Finance Costs totalled $43.65 million a 45% increase from the corresponding period last year. (2022: $30.13 million).

Profit Before Tax for the nine months ended September 30, 2023, amounted to $86.33 million, an 85% increase relative to $46.55 million reported in 2022. Profit Before Tax for the third quarter amounted to $8.14 million (2022: $9.04 million).

Taxation for the nine months ended September 30, 2023 amounted to $1.03 million (2022: nil). As such, Net Profit for the nine months amounted to $85.30 million, an 83% increase from the $46.55 million reported in 2022. For the third quarter, Net Profit was $7.11 million (2022: $9.04 million).

Consequently, Earnings Per Share for the nine months amounted to 10.80 cents (2022: EPS of 5.22 cents), while Earnings Per Share for the quarter totaled 0.88 cents (2022: EPS: 1.17 cents). The twelve-month trailing EPS was 11.14 cents and the number of shares used in these calculations was 780,000,000.

Notably, EFRESH’s stock price closed the trading period on November 13, 2023 at a price of $1.55 with a corresponding P/E ratio of 13.91x.

Balance Sheet Highlights

The company’s assets totalled $1.20 billion (2022: $997.67 million). The growth in total assets was primarily due to ‘Cash and cash equivalents’ growing by $125.08 million to close at $197.60 million. (2022: $72.53 million).

Shareholder’s equity was $449.61 million (2022: $365.81 million), representing a book value per share of $0.58 (2022: $0.47).

Analyst Certification -The views expressed in this research report accurately reflect the personal views of Mayberry Investments Limited Research Department about those issuer (s) or securities as at the date of this report. Each research analyst (s) also certify that no part of their compensation was, is, or will be, directly or indirectly, related to the specific recommendation(s) or view (s) expressed by that research analyst in this research report.

Company Disclosure -The information contained herein has been obtained from sources believed to be reliable, however its accuracy and completeness cannot be guaranteed. You are hereby notified that any disclosure, copying, distribution or taking any action in reliance on the contents of this information is strictly prohibited and may be unlawful. Mayberry may affect transactions or have positions in securities mentioned herein. In addition, employees of Mayberry may have positions and effect transactions in the securities mentioned herein.